DBS Bank India plans to double small business book in 3 years
MUMBAI : Having achieved its target of a billion-dollar book in the small business segment, DBS Bank India now plans to double its exposure in three years, a senior banker said, underscoring the lender’s optimism around a sector that contributes nearly 30% to the gross domestic product (GDP) and is a significant job creator. “We are growing our SME (small and medium enterprise) book and we have added new products. Like startups, it is not only a lending business and there is a liability side of the business too," Rajat Verma, managing director and head of institutional banking at DBS Bank India said in an interview.
Its SME business revenue has increased to 20% of its institutional banking revenue in Q1 2024, from 19% in Q1 2023. These percentages, however, exclude the offshore institutional book. Verma believes the current growth trajectory of its small business segment, which he says is “in the 30s", should continue at the current level.
“I am a great fan of a consistent growth rate over a period of time. It is not good to do 40% one year and then 10% the other year but 20-25% consistently; the book could double in the next three years." Launched in 2019, DBS Bank India is a wholly-owned subsidiary of DBS Bank Ltd, Singapore. India allows foreign banks to operate either as a branch or a wholly-owned subsidiary of the parent.
The other bank to set up a local subsidiary was SBM Bank India, while the rest operate as branches. “We have touched the $1 billion (fund and non fund based SME exposures) mark in the SME business and we think it is one of the businesses which will drive our growth. This also includes loans given to startups," said Verma who joined the bank in 2023 from HSBC India.
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